A short sale is when a homeowner in pre-foreclosure or foreclosure is able to negotiate with the bank to sell the house for less than the amount owed to the lender.

Foreclosure is when the bank repossesses the property from a homeowner that is unable to pay their mortgage.

A short sale is often less expensive for the bank and less involved. It allows the homeowner’s credit score to be less affected and often times is a much less embarrassing option for the distressed homeowner.

Forbearance is the postponement of mortgage payments for a set amount of time. Most often the lump sum of the postponed payments is due once the moratorium is up.

While forbearance may seem like a viable option for many to postpone their mortgage payments… It will often become overwhelming as the payments become due again. In most cases forbearance will lead to pre-foreclosure or foreclosure. If you are in forbearance and unable to save for the upcoming payment, contact us to start talking about a short sale.

While a short sale will still affect your credit score, it will often be much less of an impact compared to that of a foreclosure.

Contact us today to talk about the differences between a short sale and a foreclosure and to get started with the process today.